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$ 16 m remainder of $ 70 m on ETI Finance assets sale due in February


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  • CB clarifies and sets record straight on sale of subsidiaries, sub-subsidiaries and investment properties of ETI Finance

 

The Central Bank is expecting the remaining $ 16 million of the total $ 70 million on the sale of select assets of ETI Finance Ltd., (ETIF) this month. 

“Currently, $ 54 million of the total $ 75 million has been received to ETIF, which was primarily utilised to repay 20% of the deposits of the company. A further $ 16 million which was delayed due to various reasons is expected to be received by the company within the month of February 2019, as informed by the buyer,” the Central Bank said in a statement. 

Following is the full statement.

Given some misinformation circulating pertaining to ETI Finance Ltd (ETIF) disposing its subsidiaries, sub-subsidiaries and investment properties, the Central Bank yesterday issued a clarification.

With regard to the said transaction, CBSL wishes to clarify the following:

At all times, CBSL maintained that “identified assets” should be disposed in its entirety to aprospective buyer, as this would generate the best benefits for the depositors of ETIF.

The Monetary Board (MB) of CBSL has always maintained that any negotiations to invest ina regulated entity or to purchase assets of such entity, should be directly dealt with therespective entity. As such, all requests made to invest and/or purchase assets of ETIF weredirected to the company. Accordingly, selection of a party to whom the assets of ETIF wereto be transferred was done by the Board of Directors (BOD) of ETIF and the MB only grantednecessary approvals from the perspective of protecting the depositors’ interests, subject tovarious conditions, including carrying out the transaction in compliance with all the applicablelaws and regulations in the country.

Whilst various bids were made by the prospective buyers ranging from $ 61 million to $ 75 million, the party proposed by the BOD of ETIF and subsequently approved by the MB had in effect made the highest bid of $ 75 million, which is $ 14 million more than the next highest bid. Further, the current buyer, was the only party recommended by the BOD of ETIF. The MB was instrumental in increasing the initial bid of $ 60 million to $ 75 million, in pursuant of obtaining the best possible benefit for the depositors of ETIF.



CBSL at all times insisted on carrying out the transaction within applicable laws and regulations. As such, each tranche of the transaction, which was channelled to ETIF through reputed banking channels was approved by CBSL subsequent to the relevant banks clearing the funds through enhanced due diligence conducted as per applicable laws and regulations.

Currently, $ 54 million of the total $ 75 million has been received to ETIF, which was primarily utilised to repay 20% of the deposits of the company. A further $ 16 million which was delayed due to various reasons is expected to be received by the company within the month of February 2019, as informed by the buyer.

 


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